TIME EUROPE
FEBRUARY 21, 2000 VOL. 155 NO. 7
SPECIAL REPORT
Counterpoint
The Lloyd's Perspective
Lloyd's of London for years has denied allegations of fraud and other wrongdoing set forth in lawsuits brought against it. From Los Angeles to New York to London, Lloyd's has said that the allegations are unfounded. Moreover, Lloyd's has not found it necessary to provide any legal rebuttal to the charges because until now the suits against it have either been settled or dimissed before any hearing into the merits of the allegations.
Those circumstances are changing. Two suits accusing Lloyd's of fraud, one in London, the other in Los Angeles, are set to come to trial, the London one this month, the American one next year. Barring a pre-trial settlement, Lloyd's will be called upon to rebut evidence of fraud with detailed evidence of its own.
"Lloyd's is confident that [the allegations] will...be rejected," said Caroline Wagstaff, head of Lloyd's marketing and communications, in a letter to TIME. "Given the imminence of the trial," Wagstaff wrote, referring to the London proceeding, "Lloyd's does not believe that it is appropriate to engage in a detailed rebuttal of the allegations through TIME magazine or through the media generally." Wagstaff went on to say that Lloyd's was "surprised that TIME is planning to run an article about these allegations at this point in time, when a thorough investigation of the facts is shortly to take place by a court of law."
On at least two occasions, however, Lloyd's has gone beyond bare denials in rebutting charges against it. In 1995, a dissident Lloyd's investor, John Melville Donner, commissioned his lawyers, the London firm of Memery Crystal, to prepare an investigative report entitled "Concealment by Lloyd's of the Nature and Scale of Liability in respect of Asbestos claims." Although the 56-page report, highly critical of Lloyd's, was marked "strictly private and confidential," it gained circulation among Lloyd's critics and others. Lloyd's London legal counsel, the firm of Freshfields, issued a 42-page rebuttal to the Memery Crystal report concluding that "none of the material relied upon in the [report] supports the allegations made against Lloyd's."
"The material which Mr. Donner asserts is evidence of his allegations is, upon analysis, not evidence of the allegations made by him," Freshfields said. "In many cases the documentation actually undermines the allegations made..."
Freshfields also issued a detailed rebuttal of the allegations which the coming fraud trial in London will examine. About 150 investors sued Lloyd's when it tried to collect money from them. The investors contended that the money was being collected fraudulently. Freshfields denied each of the fraud allegations individually in a 117-page document.
The full text of the Memery Crystal Report, the investors' lawsuit, and Lloyd's rebuttals to both will be available on TIME's website (www.time.com/europe), as well as other Lloyd's and Lloyd's related documents which are mentioned in TIME's special report. The defences advanced by Lloyd's in the Jaffray action will be reported in due course as will the findings of the judge and the result of any appeal.
Of the individuals who figure prominently in the article:
Sir David Rowland, knighted in 1997, was named chairman of the NatWest Group, parent of the National Westminster Bank, in April, 1999. NatWest, which last week surrendered to a takeover bid from the Royal Bank of Scotland, has long had a close relationship with Lloyd's. Rowland has been president of Templeton College, Oxford, since 1998. He declined comment on the allegations made by dissident Names and critical investigators.
Murray Lawrence is semi-retired from the insurance business. He is an active member of several exclusive golf clubs and a Fellow of Winchester College, one of the leading private boarding schools for boys in England. He too declined comment. However, both Rowland and Lawrence have given sworn depositions in the West case in the U. S. in which they generally deny any wrongdoing.
David Coleridge is retired and also declined comment--other than on his cousin Priscilla's specific allegations--citing a request from Freshfields to say nothing about his tenure at Lloyd's pending resolution of the Jaffray case.
Stephen Merrett said, "I am disinclined to get into the headlines again if I can avoid it, not because I've got any sense of guilt feelings about what I did ... I don't recognize at all the picture that was painted of deliberate deceit [in Mr Justice Creswell's findings] ... [The Names] weren't kept deliberately in the dark. We had done our best to establish proper reserves against the liabilities."
Charles Parnell did not respond to a letter from TIME seeking comment. Reached by telephone, Parnell declined comment.
Ralph Rokeby-Johnson divides his time between South Africa and Southern California, where his mansion is on sale through Sotheby's International for $11.39 million. For comment beyond that contained in the article, he referred TIME to Donald C. Greene of the law firm of LeBouef Lamb Greene & MacRae in New York. Greene did not respond to a letter seeking comment.
Ronald Verrall declined comment.
Sir Peter Green died in July 1996.
More stories and related links
TIME Europe Home
E-mail us at mail@timeatlantic.com
COPYRIGHT © 2000 TIME INC. NEW MEDIA
|
|
|
